According to World Bank report,India’s GDP growth is expected to accelerate moderately to 7.5% in Fiscal Year 19-20.The growth will be driven by (a)investment strengthening (b)improved export performance and (c)resilient consumption.
The report said that on the demand side,domestic consumption has remained the primary growth driver but gross fixed capital formation and exports also made growing contributions.
The report added that inflation is expected to converge toward 4% due to robust growth and recovery in food prices.Further,it added that both the current account deficit and fiscal deficit are expected to narrow down due to improvements in India’s export performance and low oil prices.
Earlier,World Bank Economist has also said that India’s economic growth in recent years has been driven by domestic demand and its exports were about one third of its potential.It asserted that India needs to focus on export-led growth.
Gross domestic product (GDP) is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period.
Gross fixed Capital formation is a term used to describe the net capital accumulation during an accounting period for a particular country.GFCF refers to additions of capital stock such as equipment,tools,transportation assets and electricity.Higher the capital formation(GFCF) of an economy, the faster an economy can grow its aggregate income.